Pikens paring down wind farm project
Jul 7, 2009 - Elizabeth Souder - The Dallas Morning News
T. Boone Pickens’ plan to build the world’s largest wind farm is off.
Instead, Pickens said he will build five or six smaller wind farms, in the Midwest and possibly Texas, though he hasn’t settled on locations.
Last year, Pickens announced that he would build a 1,000-megawatt wind farm in Pampa, Texas. The problem a lack of a transmission line to bring the juice to population centers, Pickens said in an interview last week.
“I don’t think the first place we build, though, is where we thought we would because we don’t have the transmission,” he said.
Remember that idea he had to build his own transmission line? “It was a little more complicated than we thought,” he said.
In May 2008, Pickens announced that his company, Mesa Power LP, would order 687 wind turbines, or 1,000 megawatts of capacity, from GE for about $2 billion. By 2014, he expected to expand the Panhandle wind farm to 4,000 megawatts.
That’s a massive amount of wind power. One nuclear power reactor is typically about 1,000 megawatts of capacity. Most wind farms offer only a few hundred megawatts.
Shortly after announcing the plan, Pickens ran into roadblocks. Natural gas prices took a dive, bringing electricity prices down with them, and making it difficult to finance a new wind farm.
“You had them standing in line to finance you when natural gas was $9″ per million British thermal units, he said. “Natural gas at $4 doesn’t have any people trying to finance you.”
But, he said, he’s lined up financing.
He couldn’t easily line up a transmission line.
The Public Utility Commission created a plan to build $5 billion in transmission lines to bring wind power from several areas of West Texas to North Texas and the Houston area. The lines will reach as far as the Panhandle but won’t follow a path that Mesa had suggested for the Pampa project.
Still, Pickens already ordered the initial round of wind turbines.
GE will start delivering them in the first quarter of 2011. Pickens has about 18 months to find a place to put them.
“I don’t have that big a garage to put them in, so I’ve got to start getting ready to use them,” he said.
Pickens said company officials are considering six sites, including places in Wisconsin, Oklahoma, Kansas and Texas. He aims to build three or four wind farms with around 150 turbines each.
He said he still wants to expand to 4,000 megawatts, but he hasn’t placed that order yet.
Pickens also said he is rebuilding his three hedge funds after turning them into cash last year.
When the markets dropped, Pickens decided to allow his investors to take their money out of the funds early.
Before the markets declined, Pickens managed more than $4 billion in the funds. Now the funds hold about $1.5 billion.
Pickens is reinvesting the energy funds and said, “We got a good year going.”